In the 2014 elections Idaho Republican candidates continued to dominate by sweeping all constitutional elected offices and 84 of 105 legislative seats. Many pundits wondered if the Tea Party fringe would capture some statewide seats but that did not happen. Idaho remains very conservative yet operating within a “traditional” republican platform.

The House remains a “divided” House starting at the top with a significant tea party-type alignment inside the House majority leadership. The House Speaker spends a good deal of time balancing and adjusting committees and bill assignments to avert negative press resulting from intra-party fighting on the floor. This divide hampers objective, forthright debate on issues and across-the-isle coalition building. As a result, the lopsided majorities in both chambers leave much work to do on some issues trying to find a majority within the majority to pass a bill, any bill.

Predicting issue outcome is tricky business. For example, this conservative legislature passed new taxes and fees for road and bridge maintenance and construction though refused to consider a minimum wage proposal and held it in committee without a hearing; floated numerous proposals to repeal the sales tax on groceries but passed none; reauthorized an income tax credit for citizens, business and corporate foundations donating to schools and libraries; and increased general fund appropriation levels for teachers salaries by introducing a new career ladder formula.

Lastly, in an unusual circumstance, the legislature refused to consider a bill to align Idaho’s child support systems with U.S. systems and other countries (if part of international treaties). This anti-federal sentiment required a one-day extraordinary session (May 18, 2015) to be called by the Governor for retooling and reconsideration of the legislation.

The 2015 Legislative Session began January 12, 2015 and adjourned sine die April 11, 2015 (and the extraordinary session convened /adjourned May 18). When the Legislature adjourned sine die on April 11th, it had been in session for 89 days. The 2015 legislative session, the longest since 2009, was 15 days longer than the 2014 session.

During the 2015 session, 763 proposed pieces of legislation were prepared for legislative committees and individual legislators. From that initial group of draft proposals, 523 bills were introduced (assigned a bill number), along with another 72 resolutions, memorials and proclamations. By the end of the session, 351 bills had passed but after the Governor’s review only 347 bills became law. Four bills were vetoed by the Governor and one bill received a line-item veto. The majority of the new laws became effective July 1, 2015.

Proposed bills throughout the session were read and analyzed to determine any impact upon the grocery business. The Idaho NWGA lobby team tracked 37 bills containing direct and indirect significance to NWGA members. This report presents only those bills that held a real possibility at some time of becoming law. Some bills introduced presented consequences in how NWGA members may operate their businesses, and some resulted in new taxes, fees, regulations and mandates; and fortunately, a few other bills benefitted grocery employers and businesses.

NWGA Sponsored Legislation

There was no NWGA sponsored legislation.

Retail Grocery

SB1111 - Minimum Wage

NWGA Position: Monitor

Status: DIED in Senate State Affairs

Summary: Raises minimum wage for workers (not clear on hours-assumed 40 hours per week) from current $7.25/hour to $8.50/hour in July 2015 and $9.75/hour in 2016, and then tied to the consumer price index going forward. The proposal was developed by a coalition of 23 groups including public employees and social justice groups.

Impact to Industry: Retail stores will see a reduction in their premium costs.

There will be a positive savings for grocery store companies as a result of less premium costs. Each store may apply a .05% reduction to their respective annual workers compensation premiums to derive an estimate of savings. Overall workers compensation rate savings is estimated at $290,000.

Tax

HB29 - Business Personal Property Taxation Exemptions

NWGA Position:Monitor

Status:Signed into law.

Effective date:July 1, 2015

Summary:This legislative proposal makes three technical corrections. Section one of the proposal relates to the definition of a taxpayer using property tax concepts instead of income tax concepts. Section two of the proposal relates to property tax loss replacement money to counties and refunds on improperly claimed exemptions. Section three relates to operating property and the $100,000 per county exemption. The proposal would limit the total amount of the exemption to the lesser of $100,000 per county or the total amount of personal property identified on the companies' reports.

Impact To Industry: Brings predictability to personal property tax exemption calculations. With each NWGA member’s store in a different county eligible to receive up $100,000, property tax savings will be important. To determine your impact determine the number of counties in which you have a store and multiple that by $100,000 for your tax exemption.

HB35 - Income Tax Preparation, Filings & Returns Requirement

NWGA Position: Monitor

Status: DIED on House Floor [25-44-1]

Summary: This proposal would require electronic filing of income tax returns by paid tax preparers once they meet a filing threshold. The legislation also requires large partnerships and large corporations to electronically file income tax returns.

Impact to Industry: Increased filing and preparation costs to retailers.

HB220 - Income Tax Credits - Charitable Contributions

NWGA Position: Monitor

Status: Signed into law.

Effective date: January 1, 2015 (retroactive for 2015 tax year)

Summary: Amends and repeals existing law relating to income tax credit for charitable contributions and limitations. It removes the January 2016 sunset and retains the $5,000 limit for corporation, $1,000 limit for couples and $500 for individuals.

Impact To Industry: Allows retailers to take the full $5,000 tax credit for charitable contributions.

HB237 - Food Use Tax

NWGA Position: Monitor

Status: Signed into law.

Effective date: April 2, 2015.

Summary: Amends existing law to provide that the Use Tax shall not apply to a retailer supplying prepared food or beverages free of charge to its employee when that retailer sells prepared food or beverages in its normal course of business. Retailers are sponsors.

Summary: Amends and adds to existing law to enact the Streamlined Sales Tax. This legislation, the Streamlined Sales Tax Simplification Act, brings together the relevant applicable statutes affecting the collection of remote Idaho sales and use taxes. The sales/use tax statutes will be modified to join, with 24 other states, the Streamlined Sales Tax Governing Board. These changes do not create new taxes or create any product or organizational exemptions but rather establishes uniformity of definitions and uniformity of administration of sales/use taxes, such as, uniform tax electronic reporting and use of an automated clearing house.

HB311/HB 330 - Transportation, Income, Grocery and Sales Tax

NWGA Position: Monitor

Status: Died in Senate Transportation

Summary: Overall goal was to remove grocery tax, increase transportation funding and reduce income tax rates. New money would be distributed 60% state and 40% local. Also proposed lowering the income tax rate for the upper brackets to 6.7% and the lowest four brackets will remain at the same tax rate. Created a floor for counties and cities for the sales tax distribution with a 3-year sunset.

Transportation

HB132 – Gaseous Fuels Permit

NWGA Position: Monitor

Status: Signed into law.

Effective Date: July 1, 2015

Summary: This bill repeals Idaho's current annual special gaseous fuels tax permits and uses an energy equivalency. Once the CNG and LPG is converted into a diesel and gasoline gallon energy equivalent, a $.25 per gallon fuel tax is applied. This tax will be paid at the pump by the retail consumer and to the distributor by the retail outlet.

Impact to Industry: $375,000 is expected to be collected from CNG/LPG vehicles across all commercial and private sectors.

Summary: Increases registration fees for all vehicles by $21, motorcycle registration by $6, $150 electric cars and $100 for hybrid cars Heavy Truck registration $25 Increase fuel tax by $.07 effective immediately from $.25 to $.32. Included ton mile tax intent language requiring the development of a formula by 2019. Added surplus eliminator diverting up to 1% of general fund revenue in excess of 4% over previous fiscal year. Adding a sunset of May 31, 2017, and adding.

HJM8 – Heavy Trucks and Designated Interstate Routes

NWGA Position: Monitor

Status: ADOPTED-Transmitted to Congress

Summary:Stating findings of the Legislature and urging and petitioning the Congress of the United States to enact the pending legislation introduced by the Idaho congressional delegation providing legal authority to the State of Idaho to determine whether to allow 129,000-pound vehicles on the federal Interstate highway system in Idaho.

Impact to Industry: Sends message of support to Congress that less truck trips/truck miles may be realized if Congress designates Idaho as a 129,000 pound commercial truck weight state on interstate highways.

SB1028 - Speed Limits

NWGA Position: Monitor

Status:Signed into law.

Effective date: July 1, 2015

Summary: This is one of a series of bills that the Idaho Supreme Court has recommended in its annual report to the Governor concerning defects or omissions in the laws. There is no provision in Idaho Code § 49-654 requiring drivers to observe legally set speed limits lower than 75 mph on interstate highways or lower than 65 mph on state highways. This bill would implement the legislative intent by making it an infraction for drivers to exceed the posted limits on interstate highways and state highways.

Pharmacy

Rule 27-0101-1401 - Biosimilar Substitution - Physician notification

NWGA Position: Support

Status: Signed into law.

Effective date: January 26, 2015.

Summary: The rule defines biological and biosimilar products. In addition it clearly outlines when a biosimilar product is dispensed in place of a biological product a physician notification is not required by the pharmacist.

Impact to Industry: There will be a positive fiscal benefit for in-store pharmacies related to the pharmacy staff time involved in outside party notification. The individual store or companywide impact depends upon each store’s or companywide frequency of substituting biosimiliar products in prescriptions.

HB175 - Medication Notification

NWGA Position: Oppose

Status: Died in House Health and Welfare

Summary: The purpose of this legislation is to allow for notification to a prescriber (physician) in the event a pharmacist makes a substitution of a biosimilar medication. The legislation allows for a three-year sunset provision.

HB5 - Pharmacy Licensure and Discipline

NWGA Position: Support

Status: Signed into law.

Effective date: July 1, 2015

Summary: This legislation would eliminate the requirement of fingerprinting for pharmacist, student pharmacists, and technician reinstatement applicants if their license or registration is lapsed by two to twelve months.

Summary: This bill will allow a nurse to transmit orders to a pharmacy for hospice patients via all means that are currently allowed for patients in an institutional facility. Additionally, this bill will allow a nurse to electronically transmit to a pharmacy an order that the nurse received verbally from a prescriber for a patient in an institutional facility or a hospice patient.

HB149 - Contact Lenses

NWGA Position: Support

Status: Died in Senate Judiciary and Rules

Summary: The bill prohibits contact lens manufacturers from setting floor prices for retailers. Currently a prescribing doctor chooses the brand, of contact lenses so a consumer cannot freely substitute the prescribed brand of contact lenses for another version. Prevents contact lens manufacturers from setting price floors locking in retailers to a set customer price.

HB188 - Pharmacy Benefit Managers

NWGA Position:Monitor

Status: Died in House Health and Welfare

Summary: Adds to existing law to provide for pharmacy audit integrity and to authorize the use of pharmacy benefit managers. The purpose of this legislation is to 1) establish minimum and uniform standards and criteria for the audit of pharmacy records by or on behalf of PBMs and other authorized entities; 2) establish a Pharmacy Benefit Manager Transparency Act that includes a registration and disclosure of information requirements; and 3) establish transparency of the covered prescription drug lists and the methodology that determines how reimbursement to the pharmacies is ultimately calculated. Language is modeled after Oregon and Washington.

Elections

HB216 - Local Elections and Initiatives

NWGA Position: Monitor

Status: Signed into law.

Effective date: July 1, 2015

Summary: Repeals, amends and adds to existing law to provide initiative and referendum procedures for cities. New section setting out requirements for city referendum; elections takes place in Nov. of odd number years; requires 20% signatures of voters from last election; 6 month collection period; no bonding measures.